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Chevron Bids for Shale Gas Exploration in Lithuania

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Chevron Bids for Shale Gas Exploration in Lithuania

VILNIUS, Lithuania - U.S. fossil fuels giant Chevron Corp. has submitted a bid to explore and extract shale gas in Lithuania as the Baltic European Union state is keen to ease dependence on Russian supplies, an official said Tuesday.

Lithuanian-registered Chevron Exploration & Production Lietuva was the only bidder to prospect a field in western Lithuania, which is believed to have shale gas and shale oil deposits, Juozas Mockevicius, head of Lithuania's geological survey, told AFP.

Mockevicius said the Baltic nation of 3 million could have from 30 to 50 billion cubic meters of extractable shale gas reserves, compared with 3.4 billion it imported from Russia last year.

Currently, Russian energy giant Gazprom is Lithuania's sole natural gas supplier.

"Under the terms of the tender, 80 million litas ($31 million) is the minimum amount of investment," he said.

The tender includes both exploration and extraction rights, but the latter would require separate approval after in-depth review, Mockevicius said.

The new center-left government of Prime Minister Algirdas Butkevicius is to take a final decision on the project following legal procedures, which could take up to two months, Mockevicius added.

Chevron plans to prospect shale gas in Lithuania were first revealed in October last year when it acquired a stake in a local company, which has a separate oil field in Western Lithuania.

Lithuania is also trying to break Gazprom's politically-charged monopoly--a legacy of Soviet-rule--by constructing a liquefied natural gas terminal which is expected to start operations by the end of 2014.

Copyright (c) 2012 Dow Jones & Company, Inc.

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